The Court of Appeal has upheld a ruling that Uber drivers are workers and are therefore entitled to basic employment rights.

The case involved the worker status of two Uber drivers, supported by the trade union movement.

In 2017, an Employment Appeals Tribunal ruled that the Uber drivers involved in the case were workers and entitled to holiday pay and at least the National Minimum Wage. Uber appealed that decision and now the higher Court of Appeal has rejected the company's claims.

The status of Uber drivers and similar workers in the 'gig economy' has been controversial for some time, as they operate in a form of self-employed status while some feel they should be classed as employees of the company and given basic worker rights.

The implications for the wider freelancer community is the grey area in the status of worker, self-employed, consultant, and freelancer for tax and employment purposes.

While traditional freelancers do not want workers rights or entitlements as they prefer to operate with the freedom of self-employed status, there are ongoing concerns that attempts to provide workers rights to gig economy workers could have a knock-on effect for contractors.

IPSE - Complex
Freelancer group, IPSE, warned that the ruling shows the UK’s employment status system is not working.

Advertisement

Andrew Chamberlain, IPSE’s Deputy Director of Policy, said: “The first thing to remember is this wasn’t a ruling on all self-employment or even the rest of the gig economy. This was about two drivers in particular circumstances.

“The fact is most people in self-employment and the gig economy enjoy their flexibility and are happy with their status.

“What this latest twist in the Uber saga does show, however, is just how complex this area is, and how much it takes to prove who is and isn’t self-employed.

“Self-employment is dynamic, always changing and very diverse. This case is only the latest example of how our creaking, outdated employment statuses simply aren’t keeping up.

“To clear the confusion of the gig economy and help more people work how they want – in employment and self-employment – the Government must introduce a statutory definition of self-employment.”

Qdos - precedent
Contractor tax adviser, Qdos, expressed concern that it could, in fact, set a precedent. Seb Maley, said: "For the rising number of gig economy workers in the UK, this ruling could set a precedent for all individuals working this way.

Advertisement

"In many cases, Uber drivers and Deliveroo riders, for example, need greater protection and should be entitled to rights - something the Government recognised earlier this week in the Good Work Plan.

"However, not all flexible and self-employed workers require protection. For example, there is a distinct difference between the needs of a gig economy worker and an independent contractor, which must be considered as the Government extends employment rights.

"When operating outside IR35, contractors, by and large, do not want employment rights, and do not consider themselves vulnerable workers.

"That said, when working inside IR35 and made to pay similar taxes to employees, independent workers expect to be offered employment rights in return - which is a perfectly reasonable request."